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20% of Bitcoin's daily trading volume generated by a single project

  • VeriBlock piggybacks Bitcoin Network to solve altcoins security features.
  • The consequences of these developments are not clear yet.

According to the recent research published by Forbes Crypto, about 20% of all Bitcoin transactions are generated by a project called VeriBlock. It is developed on top of Bitcoin blockchain with the aim to provide a more secure alternative to existing cryptocurrency networks.

VeriBlock is based on proof-of-proof (PoP) concept that functions as a supplemental consensus mechanism for blockchains integrated with VeriBlock. 

Basically, it allows minor altcoin projects to avoid security issues related to low hash rate and relatively low reward for mining. Low hash rate may lead double spend issues and 51% attack - something that is happening with Ethereum Classic now. 

VeriBlock claims to improve the security of altcoins by embedding their ledgers into Bitcoin blockchain and allowing them to piggyback on the massive hash rate of the Bitcoin network. 

While the idea of making altcoins safer might look appealing, one would remember that it is done at the expense of Bitcoin users. VeriBlock operations overload the network and make Bitcoin transfers more expensive. Considering that Bitcoin is a permissionless system where anyone who is willing to pay can get their transactions into the blockchain, no one can stop VeriBlock from doing what they are doing. 

The actual consequences of this activity are not clear at this stage, though the viability of the project and its effect on the Bitcoin network is worth tracking in months to come. 
 

Author

Tanya Abrosimova

Tanya Abrosimova

Independent Analyst

 

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